Perception almost always lags reality. When it comes to accepting truths that don’t jive with our ingrained way of thinking, inertia is just part of human nature — but it can be dangerous.

This is certainly true for how owners and operators of American small businesses think about risk. Let’s say you run a small cafe, an auto shop, a medical office, a hotel or even a hair salon. Which threats would keep you up at night? If you’re like most, you’d be worried about a break-in, kitchen fire, flooding from a broken water line or anything else that would cause physical damage and put your shop out of commission for a while.

While physical threats to a business can be very serious, online threats are far more pervasive, have immediate impacts on revenue and could result in a business shutting down. A cyberbreach or bad online reputation score is more likely to hurt revenue and possibly shutter a business than a robbery.

The Truth About Threats To The Physical Business

It’s easy to understand why business owners are afraid of being robbed. After all, who wants to think about someone smashing a window or prying open a door to steal cash and other valuables? That’s a traumatic thought, and it explains why 52% of respondents in our recent small business threat survey said theft or robbery would be “extremely damaging” to their business.

The truth is, acts of theft or robbery are pretty rare and are getting easier and easier to prevent. According to data from Insureon, less than 9% of SMBs were victims of burglary or theft last year. Furthermore, most business theft involves employees, not masked bandits smashing and grabbing.

When these crimes do occur, burglaries cost businesses an average of $8,000 per incident. That’s real money, but security systems have come a long way in offering protection to deter these criminal activities, and you can buy theft insurance to recoup the losses. With some simple safeguards in place, small businesses can be very confident that they’re protected against theft or robbery.

What about a more dramatic event, like a natural disaster? We’re coming off one of the most active and devastating hurricane seasons in memory, so Womply’s data science team analyzed the mega-storms’ impact on local businesses. What we found was surprising.

A common refrain is that 25-40% of small businesses hit by hurricanes never recover, but analysts and researchers have been challenging those figures. We analyzed revenue for small businesses in areas of Houston and Florida affected by Hurricanes Harvey and Irma, and we found that, on average, local businesses returned to normal revenue levels within a week after the storms hit.

Unfortunately, some businesses don’t ever bounce back — some take a serious hit in terms of damage and lost revenue, and natural disasters obviously pose serious threats to people and property. But SMB revenue is surprisingly resilient to hurricanes, and property damage and business stoppage can be mitigated with proper insurance.

The Growing Challenge Of Online Threats

In contrast to physical threats, online threats are more nefarious because they’re harder to prevent and cause more dramatic declines in revenue. In general, business owners don’t understand online business threats and don’t know how to protect their companies against them.

Take a cyberattack, for example. If you read headlines, you’d think breaches only happen at big multinational companies with millions of customers like Target, Home Depot, Sony and Equifax. In a recent 12-month period, however, hackers targeted 14 million small businesses. About half of all data hacks are aimed at small businesses.

Despite the prevalence of cyberattacks on small companies, owners don’t recognize the gravity. According to our survey, only 32% of respondents consider a cyberattack “extremely damaging,” ranking it outside the top 10 responses and below options such as a workplace injury to an employee or a federal policy change requiring paid leave for staff. That’s an alarming disconnect since 60% of small businesses that experience a cyberattack are out of business within six months.

That said, cyberattacks aren’t the only type of threat businesses should be worried about. What most SMBs do not realize is that digital threats can also come from your customers, not just crooks. People have always found out about local businesses via word of mouth, but these conversations have migrated online to review sites like Yelp, Google, Facebook and TripAdvisor. These days, 92% of consumers read online reviews, and 88% trust them as much as recommendations from friends and family.

So, what happens when someone posts a negative review about your business? It causes serious reputational harm, the costliest category of business damage, according to data from The Hartford, at $50,000 per incident. That’s six times more damaging than a burglary, three times more damaging than water damage and twice as damaging as wind or hail.

Here again, the perception of small business owners defies reality. Only 31% of our respondents said negative online reviews are “extremely damaging.” Consider, however, that a single negative review can cost your business 30 customers. On average, Womply’s small business customers collect about $90 per customer transaction. So a single bad review could mean you lose at least $2,700, and that number gets much higher when you factor in repeat customers.

Furthermore, some studies suggest a one-star rating change can affect your revenue by 39%. If your business books $5,000 in sales each month, a bump from three to four stars could mean you’d be making nearly $7,000 per month as a result of a better online business reputation. Conversely, a drop from four to three stars would tank revenue to about $3,000. That’s a big swing.

Times are changing, and so are the threats. For small business owners, company earnings and personal income are one and the same, so lost revenue can mean missing a mortgage payment, skipping vacation or delaying retirement. To protect entrepreneurs’ livelihoods, we need an updated view of which threats have the biggest impact on revenue. Increasingly, those threats are found online.